For over a month, the news on whether or not the Nationals were going to exceed the Competitive Balance Tax threshold has been a bouncing ball. On November 13th, the USA Today came out with a 2017 recap of the teams who exceeded the tax threshold and the Nationals were at one point above the threshold then below it on a revision. According to a comment Mike Rizzo made at the “State of the Nats” forum, Rizzo confirmed the USA Today report which was welcomed news, but then ESPN yesterday came out with a report quoting the Associated Press that goes with another report that the Nationals were $7.25 million over the tax threshold.
Then Maury Brown of the Biz of Baseball from Forbes last evening did not list the Nationals exceeding the tax threshold, but then he corrected himself later that the Nationals were the 5th highest in payroll and did exceed the tax threshold.
CORRECTION due to table formatting off the AP wire. Dodgers, and Yankees numbers correct. The Red Sox did NOT break the threshold. Giants were $4,133,193, Tigers $3,661,484 and the Nationals were $1,448,190. My apologies on that. https://t.co/snnYq8HTxN
— Maury Brown (@BizballMaury) December 20, 2017
We were told by a source that teams had the ability to appeal their numbers when they were revealed at the GM Meetings in November. Apparently the Nationals numbers had differences in the calculations on Max Scherzer’s and Stephen Strasburg’s salaries which have deferrals but also Strasburg has an opt-out which should have been reason enough to not use an AAV for his entire contract.
The way MLB calculates numbers is that they do not use actual payroll rather use a present value calculation for deferred contracts as well as imputed a payroll benefits number as well as adding in 40-man payroll that the team is responsible for which included all of those veteran deals for players like Jeremy Guthrie but also players who never made it out of the minors like Clint Robinson.
In the end, the Nationals went approximately $7.25 million over the tax threshold. The Nationals spent more than the Boston Red Sox, Chicago Cubs and the Los Angeles Angels.
With this knowledge, it seems inevitable that the Nationals will exceed the 2018 level also which would carry a higher penalty of 30%. If that does not surprise you, the way it looks now with the Yankees and Dodgers slashing payroll, the Washington Nationals look like they could have the highest payroll in 2018.
This is the same Washington Nationals who have been heckled for being “cheap” that they underpay their manager, and they will spend more than any other team while making a fraction of what the largest market teams make in TV revenue and gate receipts.